Sabah will never surrender its rights under the Federal Constitution

Press Statement Miniister of Finance, Sabah


KOTA KINABALU: The State Government of Sabah will never compromise or surrender its rights under the Federal Constitution. This absolute position also applies to the special grant entitlement pursuant to Article 112C and section 2 of Part IV in the Tenth Schedule as well as Article 112D of the Federal Constitution which expressly provides for a formula and review of the
40 per cent net revenue entitlement that the Federation derives from Sabah.
It is necessary to make this thoroughly clear in response to baseless allegations that the State Government has foregone its rights in relation to this special grant. I can categorically state the
State did not relinquish any of its constitutional rights in respect of the
arrangement in 2022 for an interim solution
Therefore the receipt of an interim payment of RM125.6 million (increased from RM26.7 million) was stated to be strictly without prejudice to all the State’s rights. Specifically. subject to the
State’s right to rely on the existing formula and an agreement to continue
further negotiations with the Federal Government. Due to the differences in interpretation and quantum then we agreed to disagree.
As a further condition to the interim arrangement. the State expressly reserved the right to claim what is due for the non-fulfilment of the Federal Government to conduct a constitutional review every five years since 1974. If both parties are unable to come to an agreement after negotiations then we will refer this matter to an independent assessor as provided in Article 112D (6) of the Federal Constitution.
We have always maintained that this constitutional arrangement for Sabah was explicitly stated in the Report of the Inter-Governmental Committee dated 27.02.1963 and is an agreed revenue sharing arrangement between the State of Sabah and the Federation which led to the formation of Malaysia in 1963. No one can deny this historical fact.
The State Government will always uphold the State’s constitutional rights. We are very much aware of what is at stake and we will do our utmost best to meet the high expectations of the public. The supreme law of the land must be respected and we are confident that the Federal Government and the State Government will arrive at a just, fair and equitable solution to this long outstanding issue as soon as possible.

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